Woman declares Rs 67.4L ancestral jewellery in ITR; gets notice, she wins in ITAT
The assessment threw up two separate issues. The first concerned jewellery worth Rs 67,39,949 that the woman had disclosed in Schedule AL of her income tax return. The tribunal also examined whether the Rs 12 lakh paid to the HUF represented a genuine brokerage expense when the same person, the HUF's Karta/coparcener, had already received another Rs 12 lakh for the same transaction.
The Income Tax Appellate Tribunal (ITAT) in Mumbai has partially relieved a woman who declared Rs 67.39 lakh in ancestral jewellery in her income tax return. The tribunal removed the entire addition made under Section 69A of the Income Tax Act after determining that the tax department had primarily relied on an inference that the jewellery was likely sold due to the taxpayer's cessation of filing wealth-tax returns.
However, the tribunal also maintained a separate disallowance of Rs 12 lakh associated with brokerage paid to a Hindu Undivided Family (HUF). The tribunal found that the same individual who provided the brokerage service had already received an identical Rs 12 lakh payment individually for the same property transaction.
The case, Anjani Ashok Parikh v. Income Tax Officer, Ward 34(1)(1), Mumbai, was heard on September 1, 2026, concerning the assessment year 2021-22. The woman had declared a total income of Rs 10.21 crore in her tax return for that year, including a one-third share from the sale of an immovable property in Mumbai for Rs 106 crore. After accounting for deductions under Sections 54EC and 54, she declared net long-term capital gains of approximately Rs 9.85 crore.
The assessment revealed two issues from the Income Tax Department's perspective. Firstly, the woman had disclosed jewellery worth Rs 67,39,949 in Schedule AL of her income tax return for the first time, as her income exceeded the Rs 50 lakh threshold requiring the schedule to be filed. The assessing officer requested purchase bills, vouchers, and bank statements for the jewellery, but the woman argued that the family-owned ornaments were inherited over several generations, making it challenging to provide decades-old purchase documents.
The tribunal rejected the assessment officer's reasoning, as filing wealth-tax returns only establishes that the taxpayer's taxable wealth fell below the applicable threshold, not that specific items of jewellery were sold or disposed of. The woman provided a historical record spanning decades, including old valuation reports, her wealth-tax return, records related to ancestral estates and the HUF, a 2015 family declaration of the distribution of ancestral jewellery, and a registered valuer's report.
The tribunal concluded that the addition was based on inference rather than sufficient evidence and hence deleted the Rs 67,39,949 addition.
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